Dogecoin has experienced a significant downturn, with its price plummeting approximately 21% over the past week to hover around $0.20. This decline comes despite two notable corporate announcements that initially sparked optimism for the cryptocurrency’s future.
Three days ago, House of Doge, the corporate arm associated with the Dogecoin Foundation and community, revealed plans to merge with a Nasdaq-listed entity and establish its own treasury. The news generated a wave of excitement, but that momentum quickly fizzled out.
On October 15, Thumzup Media Corporation announced it was exploring the integration of Dogecoin for creator payouts within its social advertising app. This initiative aims to alleviate cross-border transaction friction while expanding its user base in the crypto space.
However, the announcement from Thumzup was exploratory and lacked confirmation of a live launch, leading traders to exercise caution and engage in profit-taking. Following the news, Dogecoin’s price dipped by about 3% on the day, with the token trading around 26% lower for the month and approximately 73% below its all-time high of $0.74.
Whale Activity Contradicts Corporate News
Despite the positive corporate developments, on-chain data indicates a significant sell-off among large holders, commonly referred to as whales. These wallets unloaded 360 million DOGE, valued at approximately $74 million. This selling spree coincided with a broader market downturn, but the scale of Dogecoin-specific selling was particularly striking.
Previously, speculation surrounding potential catalysts had driven DOGE’s price toward the $0.25 to $0.30 range. However, as momentum waned, profit-taking became prevalent.
Broader Market Conditions Add Pressure
The overall crypto market has also been in a state of decline, with major tokens like Bitcoin (BTC) and Ethereum (ETH) experiencing losses during the week. As liquidity decreases and risk aversion spreads throughout the market, meme coins such as DOGE tend to face sharper corrections. Traders often pivot their investments toward larger-cap assets during these turbulent times.
Analysts noted that the lack of a definitive follow-through from new corporate initiatives, like Thumzup’s announcement, has exacerbated the weakness in Dogecoin’s market performance. Observers have pointed to diminished inflows into meme assets and thinner liquidity conditions as crucial factors impacting the token’s price.
Technical Analysis Points to Critical Level
Traders are closely monitoring the $0.19 level, which is viewed as critical support for Dogecoin. Market analyst Ali Martinez indicated that maintaining this level could pave the way for a potential recovery toward $0.33 in the upcoming weeks.
Martinez’s analysis suggests that holding the lower boundary near $0.19 could trigger a recovery toward mid-range resistance around $0.25, and eventually to $0.33 if market momentum improves. Conversely, failure to maintain this support could lead to deeper losses, potentially pushing DOGE down to $0.17.
Additional resistance levels have been identified between $0.22 and $0.24, emphasizing the necessity for stronger buying volume to confirm a reversal in price trends. The Relative Strength Index (RSI) for Dogecoin is currently around 45, typically indicating weakening market sentiment when below 50.
Technical analysts believe the next 48 to 72 hours will be decisive in determining whether DOGE stabilizes within its trading channel or further declines below key support levels. Recent trading volumes have surged to 10% of the circulating supply. If DOGE manages to break through the $0.22 resistance, some analysts predict it may initiate a rally toward higher price levels.
Interestingly, Thumzup had previously invested $2.5 million in DogeHash Technologies to bolster its exposure to Dogecoin mining. The company reiterated that Dogecoin would function as an alternative payout method rather than a direct replacement for fiat currency.
The evolving narrative surrounding Dogecoin continues to captivate market participants, but the recent sell-off highlights the volatility and unpredictability that define the meme coin’s journey.
